Travelers 2014 Annual Report Download - page 222

Table of Contents
THE TRAVELERS COMPANIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
9. SHAREHOLDERS' EQUITY AND DIVIDEND AVAILABILITY (Continued)
Treasury Stock
The Company's board of directors has approved common share repurchase authorizations under which repurchases may be made from time to
time in the open market, pursuant to pre
- set trading plans meeting the requirements of Rule 10b5 - 1 under the Securities Exchange Act of 1934, in
private transactions or otherwise. The authorizations do not have a stated expiration date. The timing and actual number of shares to be
repurchased in the future will depend on a variety of factors, including the Company's financial position, earnings, share price, catastrophe losses,
maintaining capital levels commensurate with the Company's desired ratings from independent rating agencies, funding of the Company's qualified
pension plan, capital requirements of the Company's operating subsidiaries, legal requirements, regulatory constraints, other investment
opportunities (including mergers and acquisitions and related financings), market conditions and other factors. The following table summarizes
repurchase activity in 2014 and remaining repurchase capacity at December 31, 2014.
The Company's Amended and Restated 2004 Stock Incentive Plan provides settlement alternatives to employees in which the Company retains
shares to cover tax withholding costs and exercise costs. During the years ended December 31, 2014 and 2013, the Company acquired $58 million
and $61 million, respectively, of its common stock under this plan.
Common shares acquired are reported as treasury stock in the consolidated balance sheet.
Dividend Availability
The Company's U.S. insurance subsidiaries, domiciled principally in the state of Connecticut, are subject to various regulatory restrictions that
limit the maximum amount of dividends available to be paid by each insurance subsidiary to its respective parent company without prior approval
of insurance regulatory authorities. A maximum of $3.25 billion is available by the end of 2015 for such dividends to the holding company, TRV,
without prior approval of the Connecticut Insurance Department. The Company may choose to accelerate the timing within 2015 and/or increase
the amount of dividends from its insurance subsidiaries in 2015, which could result in certain dividends being subject to approval by the
Connecticut Insurance Department.
In addition to the regulatory restrictions on the availability of dividends that can be paid by the Company's U.S. insurance subsidiaries, the
maximum amount of dividends that may be paid to the Company's shareholders is limited, to a lesser degree, by certain covenants contained in its
line of credit agreement with a syndicate of financial institutions that require the Company to maintain a minimum consolidated net worth as
described in note 8.
221
Quarterly Period Ending
(in millions, except per share amounts)
Number of
shares
purchased
Cost of
shares
repurchased
Average price
paid per share
Remaining capacity
under share repurchase
authorization
March 31, 2014
7.8
$
650
$
82.97
$
4,109
June 30, 2014
9.5
875
92.67
3,234
September 30, 2014
8.1
750
92.47
2,484
December 31, 2014
9.7
1,000
102.82
1,484
Total
35.1
$
3,275
93.27
1,484